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August 17, 2015

Posted  January 28, 2016

Citigroup affiliates, Citigroup Global Markets, Inc. (CGMI) and Citigroup Alternative Investments LLC (CAI), will pay $180 million to settle charges that they defrauded investors in two hedge funds by claiming that the funds were safe, low-risk, and suitable for traditional bond investors.  An SEC investigation found that even as the funds began to collapse, CGMI and CAI failed to disclose the dire condition of the funds.  Many of the misleading representations were at odds with disclosures in written materials provided to investors.  The funds raised nearly $3 billion from approximately 4,000 investors before collapsing.  CGMI and CAI will bear all costs of distributing the $180 million in settlement funds to harmed investors.  SEC

Tagged in: Misrepresentations, Securities Fraud,